Bath & Body Works Earnings Are Strong. But the Holidays Don’t Look So Bright.

Sales of $1.56 billion also were above analysts’ estimates of $1.55 billion.

“As we close out the year, our team remains focused on delivering a great Holiday assortment and omnichannel experience for customers while leveraging our agility to chase demand,” said CEO Gina Boswell in the earnings release.

The company said it updated its full-year forecast to reflect strong third-quarter results, the impact of debt and share repurchases, and lower sales expectations for the fiscal year.

However, the fourth quarter—typically the company’s strongest—doesn’t look as strong as analysts had been expecting.

For its fourth quarter, Bath & Body Works expects net sales to decline 1% to 5% from the year-ago period, and estimates earnings of between $1.70 and $1.90 a share, while analysts had penciled in earnings of $1.98.

And for fiscal 2023, it expects net sales to decline 2.5% to 4% from the previous year, and for earnings of between $2.99 to $3.19, compared to an earlier call for a sales decline between 1.5% and 3.5% and an earnings range of $2.85 and $3.15. Analysts expect full-year EPS of $3.06.

The stock was falling 6.7% to $30.32, putting it on pace for its largest percent decrease since Nov. 16, 2022, when it dropped 7.6%, according to Dow Jones Market Data. Shares have fallen 28% this year.

Write to Emily Dattilo at [email protected]